Uber and Didi Call a Truce In China With a $35 Billion Deal (recode.net) 45
Kara Swisher, reporting for Recode: Uber, which has been spending hugely in China over the last two years, has folded, striking a deal in which it will merge its Chinese operations with its main rival there, Didi Chuxing. Under terms of the deal, Uber China, the ride-hailing company's Chinese subsidiary, will be part of a larger Didi company valued at $35 billion. Uber gets a 20 percent stake in that -- Didi's previous valuation was $28 billion. That's a $7 billion value for upward of $2 billion that Uber has frittered away, um, spent there. In turn, Didi will invest in Uber at a valuation of almost $70 billion. That was about the value of Uber's last round. Now, everyone owns everyone everywhere.
Frittered Away? (Score:5, Interesting)
If they managed to get a stake worth $7 billion from spending $2 billion, that $2 billion is arguably well spent, even if the actually places the money went look silly.
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Yeah, but the running gag is this 35 and 70 billion dollar "valuation" scam, which is phonier than a three dollar bill. How can anybody believe this shit? It has to be just the number the taxpayers will pay out in the next set of Wall Street Bailouts... Once again we are being set up as pansies during an election year grift.
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I don't understand your argument. Uber spent $2 billion to prop up Uber China, and ultimately gained assets worth $7 billion as part of the merger. That certainly seems like a $2 billion investment just turned into $7 billion. Of course this is all based on the current valuation and their stake in Didi Chuxing is no where near as liquid as the $2 billion in cash Uber spent, but as of now it seems to be a good deal. Not as good as Uber completely winning out in that market as they would have liked, but certa
Re:Frittered Away? (Score:5, Insightful)
The problem is that the $2B spent is cold, hard cash that came from investors, while the $7B valuation is just an estimate, based on what a few people think. It may prove to be ephemeral.
Uber not so great as a whole (Score:2, Insightful)
For everything that Uber is good for a rider. It's bad for the industry as a whole. It's driven down rates, but at the same time ignored regulations, driver pay, and uniform service. When you basically have a short and quick application, no significant back ground check because myself was approved to drive even before being approved by Checkr the company doing the background check. This sends up red flags in so many ways, and now Uber is raising the percentage they keep from rates all the while reducing rat
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As someone in a smaller market, the cost is a very minor part of Uber.
There's also the fact that I can actually get a ride.
I've waited 90 minutes for a cab, while Uber in the same location same time of night is always under 10.
I'd happily pay 25% more than cabs for Uber (and when there's surge pricing I often pay more than that even), cabs aren't worth it (in Philadelphia outside of center city, in northern Delaware, and in New Orleans. In San Fransisco, I'd use the Uber app, but often just to hail a cab.)
Uber (Score:2)
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Absolutely.
It looks to me like spending 2,000,000,000 got them a lot more over a couple years.
By being credible competition they won big. They're also getting additional money at a decent valuation of their own company.
Seems like Uber won big doing business in China.
That's dealing with a Chinese company for you (Score:4, Interesting)
Whenever China finds out that something you do is profitable, they'll sure find a way to wrest it from your hands. In the end, anything that's profitable in China has to be in Chinese hands, in one way or another. If nothing else, you'll be forced into a joint-venture with a Chinese "partner". With "partner" being something akin to being married in a shotgun wedding.
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That's their business model since 40 years now and its working well.
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You have to be in the position to pull it off, though. The US isn't. Unless I can get your workslaves for a buck a day, you have nothing to bargain with.
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Yup, and when trump speaks of nationalism it's racist. Can't work for us here, nope! We have to play fair to the world that isn't playing fair.
Beware what you wish for. Its much easier to be protectionist when your population is happy with a $13400 GDP/capita (PPP). If the Chinese ever want to reach a level of prosperity similar to the US ($52,550 GDP/capita (PPP)) they will not be able to continue these practices. The world only puts up with it now to access their cheap labor, but China's trade agreements will become far less favorable once their factory workers start demanding $20/hr.
China's practices are certainly working for them as they catch
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but China's trade agreements will become far less favorable once their factory workers start demanding $20/hr.
Which is why china is colonizing Africa at the moment. There the workers are still cheap. Lots of businessmen in china are now having these problems that the workers demand more pay and will have to close their businesses unless they find a place where they can still treat their workers like shit.
same china that where helping some makes you lieab (Score:2)
same china that where helping some makes you liable so people just keep running the same person over.
Uber will work good there
Ride-hailing company? (Score:2, Interesting)
In a different article it was called "ride-sharing".
Why don't you just call it what it really is - an unlicensed, unregulated taxi company.
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In a different article it was called "ride-sharing".
Why don't you just call it what it really is - an unlicensed, unregulated taxi company.
That would be a better description. The passenger hails the ride, the company responds to the hail with a driver. So its neither a ride-hailing nor a ride-sharing company, it is a ride-selling company.
Trump is right China forces you have to have them (Score:2)
Trump is right China forces you have to have them own parts of your company to be able to sell there. But we can't do the same hear.
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When Uber and Lyft stomped out of Austin like whiney, spoiled brats, the free market stepped in a started creating alternatives. One of them is a non-profit:
http://www.austinchronicle.com... [austinchronicle.com]
I haven't used it yet, but I like the idea of non-profit or B-Corps competing side by side with the for-profit companies.
-Chris
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Oh, knock off that BS and read the actual ordinance and understand the circumstances under which it was passed.
1) Uber and Lyft did not move into Austin, demand to be exempt from existing law, and leave in a snit when they were told no. They were already operating in Austin for quite some time when this brand NEW law was imposed for the specific purpose of running them out of town.
2) There was a lot more in there than just the background check people were making a big deal about. They were restricted in